Amtrada sees tighter cocoa market in 2013/14

 * Global 2013/14 cocoa deficit pegged at 85,000 t
 * Vietnam 2013/14 robusta crop seen rising to 29 mln bags
 * Continaf winds down Indonesian cocoa operations

World 2013/14 cocoa supplies should tighten as stronger-than-expected demand widens a second consecutive global deficit, Amtrada Holding B.V., which owns cocoa and coffee trading companies including Continaf and Nedcoffee, said on Thursday.

A cocoa farmer

   Hans Hendriksen, managing director of Amtrada, forecast a 2013/14 deficit of 85,000 tonnes, compared with a very small deficit the previous year.
   "We see some pick up in consumption in some Western European and American markets, it's better than flat and that was the initial expectation," Hendriksen said in an interview.
   "We still see demand growth in the Far East."
   ICE cocoa futures rose to a 2-year high on Thursday.
   Amtrada's forecast is below major commodities trader Olam International Ltd's 185,000-tonne deficit.
   Hendriksen forecast global 2013/14 cocoa production in line with the previous year at around 4 million tonnes, although he noted that sustained higher prices were likely to eventually trigger a supply response.
   "Higher prices will eventually impact consumption... there might be a shift back to vegetable fats being used more than (cocoa) butter," Hendriksen said.
   When cocoa beans are processed they make roughly equal parts butter and powder.
   Amtrada's Nedcoffee, which mostly trades robusta coffee, expects global robusta supplies will be boosted by a bumper crop from top grower Vietnam, where harvest has already started.
   Hendriksen estimated Vietnam's 2013/14 output at around 29 million 60-kg bags, up from around 25 million bags the previous year.
   "We see tightness in robusta for this month and next month, until the new crop from Vietnam comes out," Hendriksen said.
   Nedcoffee has operations in Indonesia, Vietnam, India and Ivory Coast and Hendriksen said the company was increasing its volumes.
   In cocoa, however, Amtrada's Continaf is closing its operations in Indonesia. Hendriksen noted that it was difficult to add value as a trader in Indonesia given the government incentives to export products instead of beans.
   Continaf does not have any cocoa bean processing capacity to grind beans into butter and powder.
   Hendriksen said that activities in other origins, including top grower Ivory Coast, will not be affected.
   "Continaf has been participating (in the daily auctions) regularly, including in the last month or so," Hendriksen added, referring to the Ivory Coast cocoa auctions.